I think maybe you’re slightly overthinking it. An asset is anything whose value you want to track.
If you’re running a business, then you have to get more specific, but in that case you should probably ask your accountant. I do like the definition given here: https://accountingo.org/financial/statements/difference-between-assets-and-expenses/ “Asset is a resource available to a business that gives it some form of economic benefit in the future.” Brandon > On Mar 30, 2021, at 11:21 AM, Dániel Fancsali <[email protected]> wrote: > > Good afternoon, > > I (think I) do understand the textbook definition of the above, but I find > myself in doubt in many cases around how I would model a certain transaction. > > On the face of it, it is very simple: if I spend $100 painting my room, > that's clearly an expense. Buying a car is clearly turning one asset > (cash/bank balance) into another one (the car itself). > > But then, fitting new wheels to the car is an expense, but then it is also > making the car worth more, so at the same time there's an appreciation > involved. (Or is the set of wheels another asset, that happens to be fitted > to the car "temporarily"). > > Also, let's think buying furniture: it's an asset, as I either use it > long-term or perhaps sell it, when I move, and need different ones for the > new house. But it can be also seen as an expense relating to me living in my > current accommodation. (Similar to utilities.) > > First I thought, the deciding factor might be, whether I can (or whether I > expect) the thing to be re-sold. But as the above examples show, it's not > always as clear cut in advance. I might sell it, I might keep on using it, or > might sell it as part of another asset (the flat or the car). > > So, I'd be really curious, how others see this, and how they keep their books > manageable. > > Let me know your thoughts. > > Regards, > Daniel > > -- > > --- > You received this message because you are subscribed to the Google Groups > "Ledger" group. > To unsubscribe from this group and stop receiving emails from it, send an > email to [email protected] > <mailto:[email protected]>. > To view this discussion on the web visit > https://groups.google.com/d/msgid/ledger-cli/CAD6oR3FCf0_XxTddBRE-H4cZOVDS2wM-8TzYNPKya2c6rH_Edg%40mail.gmail.com > > <https://groups.google.com/d/msgid/ledger-cli/CAD6oR3FCf0_XxTddBRE-H4cZOVDS2wM-8TzYNPKya2c6rH_Edg%40mail.gmail.com?utm_medium=email&utm_source=footer>. -- --- You received this message because you are subscribed to the Google Groups "Ledger" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. To view this discussion on the web visit https://groups.google.com/d/msgid/ledger-cli/7C9F48BB-E765-4FFF-BB56-FB923F4CECD3%40gmail.com.
